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CS Professional · Insolvency and Bankruptcy - Law and Practice · Insolvency Resolution of Individuals and Partnership Firms

Rahul Mehta, an individual debtor in Pune, has been adjudged bankrupt by a bankruptcy order passed by the Debt Recovery Tribunal on 10 March. His creditor asks which date counts as the 'bankruptcy commencement date' under Part III of the IBC. Which is correct?

The bankruptcy commencement date is the date on which the Adjudicating Authority passes the bankruptcy order, here 10 March. It is not the date of filing the application, serving notice or appointing the trustee, because the Code ties commencement to the order itself.

  1. AThe date on which the creditor first filed the application
  2. BThe date on which the bankruptcy order is passed by the Adjudicating AuthorityCorrect
  3. CThe date on which the bankruptcy trustee was appointed
  4. DThe date on which the debtor was first served notice of default

Explanation

The Code defines the bankruptcy commencement date as the date on which a bankruptcy order is passed by the Adjudicating Authority under section 126. Here that is 10 March. The filing date and the trustee appointment date are different events and do not fix the commencement date.

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